Month: September 2013

by David Safier

As I posted Wednesday, Whitney Tilson, who runs Kase Capital hedge fund, is shorting K12 Inc. On Sunday, he explained why.

Before I go into Tilson's reasons for the short, I feel the need, once again, to ask for Craig Barrett's views on this. Barrett, Gov. Brewer's spokesman on education, president and chairman of BASIS charter schools, one of the prime movers behind the Common Core and rich, savvy ex-CEO of Intel, is also one of 10 members of the K12 Inc. Board. While he talks in public and to the press regularly, he has never, so far as I know, talked about K12 Inc. or its Arizona Virtual Academy for the record. Yet K12 Inc.'s Arizona school alone enrolls over 4,000 students, which is similar to the number of students enrolled in all Arizona BASIS charters combined — and that's only in Arizona. Certainly the subject deserves a mention from a high profile educational spokesman like Barrett.

Tilson goes into his reasons for shorting K12 Inc. at some length. They are based both on recent earnings and what he sees as an untenable educational model. He notes that "year-over-year revenue growth – critical for a stock trading at nearly 50x earnings – has been falling sharply over the past two years, and is projected to fall further in the next year (to 16%)."

He says that, while there are a small number of students who are well suited to the virtual school model, K12 Inc. needs lots of students, which means aggressive recruiting for students, most of whom are a bad fit. "Since going public in late 2007, numerous former employees have told me that K12 has adopted a growth-at-any cost mentality in order to support its richly priced stock."

Posted by AzBlueMeanie:

Last week Tea Party Activists Celebrated Book-Banning in Southern Arizona (Phoenix New Times):

Tea party activists are celebrating as one of their own successfully got a book banned from a southern Arizona school district.

Debbie Stoner, a tea party organizer in the small community of Palominas, near
Sierra Vista, alleged that her son, a sophomore at Buena High School in
Sierra Vista, was told to read a pornographic book. She took it as far
to allege that some sort of child abuse had been committed as a result
of the boy's teacher assigning this to the class.

Here's that hardcore porn featured in the novel Dreaming in Cuban:

Hugo
and Felicia stripped in their room, dissolving easily into one another,
and made love against the whitewashed walls. Hugo bit Felicia's breast
and left purplish bands of bruises on her upper thighs. He knelt before
her in the tub and massaged black Spanish soap between her legs. He
entered her repeatedly from behind.

Felicia learned what pleased him. She tied his arms above his head with
their underclothing and slapping him sharply when he asked.

"You're my bitch," Hugo said, groaning.

In the morning he left, promising to return in the summer.

Um, what? If that's hardcore porn, we've got some Internet links to share with Mrs. Stoner.